Meesho IPO: Elevation Capital, Peak XV to lead secondary share sale
Meesho’s IPO will see early backers Elevation Capital and Peak XV offload over 8.5 crore shares, while major investors Prosus and SoftBank will retain their stakes.
Ecommerce player Meesho's early backers, Elevation Capital and Peak XV, will lead secondary sales in its initial public offering (IPO) as prominent investors Prosus and SoftBank sit on the fence.
According to the company's updated draft red herring prospectus, Elevation Capital, which holds a 13.61% stake in the ecommerce player, plans to offload 5.54 crore shares acquired at a weighted average of Rs 3.04 per share. Peak XV, which has a combined stake of 12.8%, plans to offload about 3 crore shares acquired at a weighted average of Rs 4.29 per share.
While Dutch investor Prosus, with a 12.34% stake, and SoftBank, with a 9.31% stake, are not offloading any shares in the IPO, the DRHP showed.
As part of the offer for sale, Meesho's co-founders and promoters will sell a combined total of 2.35 crore shares, accounting for a marginal share of their total stake. Co-founder and CEO Vidit Aatrey owns 11.10% stake in the company, while co-founder and CTO Sanjeev Kumar owns 7.41% stake in the company.
Other selling shareholders include Y Combinator, Venture Highway, Man Hay Tam, and Golden Summit.
The IPO consist of an offer for sale component of 17.56 crore shares as well as a primary issue of up to Rs 4,250 crore. The company said it will also consider a pre-IPO placement of Rs 850 crore, following which the amount will be deducted from the fresh issue.
According to a report by The Economic Times, Meesho is targeting a listing on domestic bourses for December later this year. The company joins a host of startups looking to launch their IPOs, including Groww, Razorpay, Wakefit.co, and Lenskart, among others.
Meesho, which competes with ecommerce giants like Flipkart and Amazon, plans to utilise Rs 1,390 crore from its IPO proceeds towards cloud infrastructure. It will disburse about Rs 480 crore towards salaries for its existing and replacement hires for AI and ML teams. A large chunk, about Rs 1,020 crore, will support Meesho's marketing and brand initiatives, the company said.
Edited by Suman Singh